National Australia Bank Ltd v Lightbody, Lawrence James
[1996] FCA 672
•2 Aug 1996
NOT SUITABLE FOR DISTRIBUTION
IN THE FEDERAL COURT OF AUSTRALIA )
)
NEW SOUTH WALES DISTRICT REGISTRY ) NG 635 of 1994
)
GENERAL DIVISION )
BETWEEN:NATIONAL AUSTRALIA BANK LIMITED ACN 004 044 937
Applicant
AND:LAWRENCE JAMES LIGHTBODY
First Respondent
AND: MARGARET ROSE LIGHTBODY
Second Respondent
AND: M G JONES
Third Respondent
AND: A R NICHOLLS, D W SISTROM, R A GAGIE, W B RANGOTT
Fourth Respondents
AND: PAUL FURY
Fifth Respondent
AND: W N J SWAN, D LARDNER, G A STRETTON, W M C ANDREWS, R SELBY, D J MARTIN, T V CHADWICK, R P FAULKS
Sixth Respondents
AND: LAWROSE SERVICES PTY LIMITED (IN LIQUIDATION) ACN 008 541 142
Seventh Respondent
AND: JAYANDA PTY LIMITED (RECEIVERS AND MANAGERS APPOINTED) (IN LIQUIDATION) ACN 008 521 533
Eighth Respondent
CORAM: Burchett J.
PLACE: Sydney
DATE: 2 August 1996
MINUTE OF ORDERS OF THE COURT
THE COURT ORDERS THAT:
The action be transferred to the Supreme Court of New South Wales, Equity Division.
The costs of the motion for transfer and of the action in this Court be payable in the same manner as the costs of the transferred proceeding in the Supreme Court.
NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA )
)
NEW SOUTH WALES DISTRICT REGISTRY ) NG 635 of 1994
)
GENERAL DIVISION )
BETWEEN:NATIONAL AUSTRALIA BANK LIMITED ACN 004 044 937
Applicant
AND:LAWRENCE JAMES LIGHTBODY
First Respondent
AND: MARGARET ROSE LIGHTBODY
Second Respondent
AND: M G JONES
Third Respondent
AND: A R NICHOLLS, D W SISTROM, R A GAGIE, W B RANGOTT
Fourth Respondents
AND: PAUL FURY
Fifth Respondent
AND: W N J SWAN, D LARDNER, G A STRETTON, W M C ANDREWS, R SELBY, D J MARTIN, T V CHADWICK, R P FAULKS
Sixth Respondents
AND: LAWROSE SERVICES PTY LIMITED (IN LIQUIDATION) ACN 008 541 142
Seventh Respondent
AND: JAYANDA PTY LIMITED (RECEIVERS AND MANAGERS APPOINTED) (IN LIQUIDATION) ACN 008 521 533
Eighth Respondent
CORAM: Burchett J.
PLACE: Sydney
DATE: 2 August 1996
REASONS FOR JUDGMENT
BURCHETT J.:
This is a motion brought by the applicant for the transfer of the proceeding to the Supreme Court of New South Wales, Equity Division, pursuant to the Jurisdiction of Courts (Cross-Vesting) Act 1987 (the Cross-Vesting Act).
The applicant bank brings its motion because it has failed to persuade Windeyer J., sitting in the Supreme Court of New South Wales, Equity Division, to transfer certain related proceedings in the Supreme Court to this court. The unreported decision of Windeyer J. was given on 8 November 1995. It appears from his Honour's reasons that the Supreme Court action, although commenced in 1991, had not reached the stage of finalisation of the pleadings. The claim, made by the seventh and eighth respondents (as plaintiffs) against the applicant (as first defendant) and two other parties, sought the setting aside of certain guarantees and the making of declarations that other guarantees had been discharged. There was a cross-claim against the plaintiffs that they aided and abetted or were knowingly concerned in false and misleading conduct of the first and second respondents in the proceeding in this court. Although the two proceedings do not involve identity of all of the various parties to each of them, and although the claims made in them are different, a number of parties are common to each, and a single complex substratum of fact does underlie both proceedings. They are also complicated by several further proceedings in the Supreme Court of the Australian Capital Territory, which appear to have some degree of relationship to the two main proceedings.
The general relationship between the proceedings is outlined in the reasons delivered by Windeyer J. I do not find it necessary to repeat that outline. However it is convenient to set out part of his Honour's conclusions, as follows:
"It is obviously convenient that these matters all be heard in the one court by the one judge. It would be very inefficient to proceed otherwise. The plaintiffs oppose the orders sought for cross-vesting of the NSW action to the Federal Court. They do so on the ground that the NSW action is the commencing point and that it started in 1991. The main Federal Court proceedings were commenced only recently because it was thought, incorrectly as it turned out, that there was otherwise some problem in seeking to set aside the composition with creditors in the NSW Court. I think the reason of the plaintiff is cogent enough. The defendant is quite content to have all the actions heard in New South Wales and without in any way seeking to influence the Federal Court or the Supreme Court of the ACT I would myself see sense in the proceedings in those courts being cross-vested to this court but it is entirely a matter for those courts. There are other courses available such as cross-vesting to the Federal Court the NSW action or the discontinuance of the Federal Court action and allowing the second cross claim to be filed but neither seems to have any particular advantage over cross-vesting to New South Wales allowing the plaintiffs to maintain their action commenced here. As the second cross claim is in general seeking the same orders as the Federal Court action it should not be allowed to be filed while that Federal Court action is on foot. As I understand the position the defendants accept that."
The circumstances with which these matters are concerned seem to have had more connection with the Australian Capital Territory than with New South Wales, and it is easy to understand why the bank chose to bring in this court a proceeding which relied on the provisions of the Bankruptcy Act 1966 (Commonwealth). However, although the plaintiffs in the Supreme Court action do not appear to have pursued it with any vigour, the fact is that they did bring it some years ago, and Windeyer J. has taken the view that they should not thus belatedly have their case removed elsewhere. Since I agree with Windeyer J. that it is plainly appropriate the various proceedings should be dealt with by the one court, so that the possible application of s.5(4) of the Cross-Vesting Act must be considered, the question arises whether there is any reason to decline the application now made to me. The argument most strongly pressed against a transfer of the proceeding in this court to the Supreme Court is that a joint hearing of all the various claims would or might compel the solicitors representing the plaintiffs in the Supreme Court to withdraw from doing so on the ground of conflict of interest. But the bank points out that if its claims would produce such a conflict upon a transfer of the action to the Supreme Court, they ought to have done so already. The conflict does not depend upon the court in which the actions proceed, but upon the nature of the various claims involved. Furthermore, this argument was raised before Windeyer J. His Honour commented on it as follows:
"There is evidence that the solicitors are acting for the plaintiffs on a particular basis as to fees and it may be that no other solicitor will be willing to so act if they decide that they should not act in a consolidated or complete action. It is not clear to me that there is sufficient strength in that argument to let it bear on the otherwise most expeditious conduct of the related proceedings. In any event the question does not arise as yet. It will arise if and after any cross-vesting order is made ... . But in any event if it were proper the court would have power to order separate trial of the cross claim or cross-vested actions. Even so it would I think be more convenient if all claims were heard in the same court."
As Windeyer J. has pointed out, a court which has all of the actions proceeding in it will be in a position to accord the point I am now considering full weight in deciding the course of the action. It will also be able to consider a special point raised by one of the parties, who claims to have so limited an interest in the broad area of the litigation as to be at risk of prejudice if required to take part in complicated and lengthy combined proceedings. In my opinion, there can really be no doubt that a court having control of at least the two principal actions in this complex of proceedings will be able to take all problems of procedure into account, and to make appropriate interlocutory orders to achieve the most satisfactory and convenient resolution of the disputes between the parties.
In all the circumstances, I am satisfied that s.5(4)(b)(iii) of the Cross-Vesting Act applies. Accordingly, I should make an order transferring the action to the Supreme Court of New South Wales, Equity Division, and that the costs of this application and of the proceeding in this court should be payable in the same manner as the costs of the transferred proceeding in the Supreme Court. A submission was made on behalf of one of the respondents that I should make a special order as to costs thrown away, but I do not think that is appropriate in the particular situation of this case.
I certify that this and the preceding five (5) pages are a true copy of the Reasons for Judgment herein of his Honour Justice Burchett.
Associate:
Date: 2 August 1996
Counsel for the Applicant: Mr A.J. Bannon
Solicitors for the Applicant: Dibbs Crowther & Osborne
Counsel for the 1st, 2nd, 3rd,
7th and 8th Respondents: Mr D. Robinson
Solicitors for the 1st, 2nd, 3rd,
7th and 8th Respondents: Boyd House & Partners
Solicitors for the 1st named 4th
Respondent: Phillips Fox
Counsel for the 2nd named 4th
Respondent: Mr B. Shields
Solicitors for the 2nd named 4th
Respondent: Messrs Sparke Helmore
Solicitors for the 3rd named 4th
Respondent: Tress Cocks & Maddox
Solicitors for the 4th named 4th
Respondent: Clayton Utz
Counsel for the 5th & 6th
Respondents: Mr D. Davies
Solicitors for the 5th and 6th
Respondents: Ebsworth & Ebsworth
Date of hearing: 30 July 1996
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